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FAIRFIELD, Iowa, September 19, 2011 – Most hedge fund strategies experienced widespread and significant losses in August, contributing to a 3.42% fall in the Barclay Hedge Fund Index compiled by BarclayHedge. Year-to-date, the Index is down 2.50%.
“In what has been the worst month since Lehman's failure in September 2008 when hedge funds dropped 6.99 percent, more than 83 percent of the 3,120 funds that have so far provided us with an August return have reported a loss,” says Sol Waksman, founder and President of BarclayHedge.
“The Barclay Hedge Fund Index is now in negative territory for the first time in 2011.”
All but one of Barclay’s 18 hedge fund indices had losses in August. The Equity Long Bias Index dropped 5.42%, Healthcare & Biotechnology fell 5.20%, European Equities were down 4.92%, Emerging Markets lost 4.85%, and the Distressed Securities Index was down 4.05%.
“Markets panicked,” says Waksman. “The threat of a banking system crisis triggered by a sovereign debt default coupled with a lack of political leadership and a weakening economic outlook drove investors to seek shelter from the storm.”
The one strategy that proved profitable was the Barclay Equity Short Bias Index, which soared 7.25%. Equity Short Bias is now up 6.07% through August.
“After eight months of difficult trading conditions, hedge fund managers trading the short side of equity markets have made a strong comeback over the past four months,” says Waksman.
“Short sellers had their largest one-month gain since October 2008, when stocks plummeted and Equity Short Bias funds gained 12.27 percent.”
The Barclay Fund of Funds Index lost 2.44% in August, and is down 2.86% year-to-date.
Click here to view five years of Barclay Hedge Fund Index data, or download 13 years of monthly data.
Sol Waksman is an experienced media source, providing perspectives on hedge fund and managed futures trends. For more commentary or background, call 641-472-3456 or email swaksman@barclayhedge.com.
BarclayHedge was founded in 1985 and actively tracks more than 6,100 hedge funds, funds of hedge funds, and managed futures programs. Each month Barclay provides updated performance rankings for 38 Hedge Fund categories, 16 CTA categories, and 7 UCITS categories.
Institutional investors, brokerage firms, and private banks worldwide utilize BarclayHedge indices as performance benchmarks for the hedge fund and managed futures industries.
